Re: Why do mutual funds get such a bad rap on here?
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Redd,
The index funds don't track the underlying indices on a complete 1:1 basis (that is, they aren't an identical mirror). They'll buy and sell out of individual components where appropriate, and correct to the index at different times.
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While this is true, this difference should not be large enough to cause a nearly 2% difference in return. If it does, then they are doing a very poor job of mimicking the return of their respective index.
The bulk of the differences has to do with dividend reinvestment.
-RMJ
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